U4 Helpdesk Answer

10 March 2021

AUTHOR Madagascar: Overview of Kaunain Rahman (TI) corruption and anti- [email protected]

corruption REVIEWED BY Sophie Lemaître (U4) Focus on the natural resources sector [email protected] (especially rosewood, gold and wildlife) Ketakandriana Rafitoson and Frédéric Lesné (TI Madagascar) Madagascar grapples with systemic corruption, a weak rule of [email protected] law and porous borders with an abundance of natural resources, which has in turn given rise to various organised criminal networks dealing in illicit trade. The ongoing COVID crisis has only exacerbated environmental crime. While RELATED U4 MATERIAL substantial research has been done on rosewood and tortoise  Madagascar’s specialised anti- trafficking, an understanding of the illicit gold sector is corruption court: The quest to required. Trafficking routes for wildlife and precious stones end impunity or cannabis seems to be same, but it is yet to be determined

if there are overlaps in crime networks.  Understanding effects of corruption on law enforcement and environmental crime

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Query

Please give an update of the Helpdesk Answer on Madagascar and provide an overview of the natural resources sector, the forms of corruption as they relate to the natural resources sector, the corruption risks, actors involved and the mechanisms used in the trafficking of three specific natural resources: rosewood, gold and wildlife.

Contents MAIN POINTS — Systemic corruption, weak rule of law 1. Background and porous borders with an abundance 2. Forms of corruption in the natural resources of natural resources has given rise to sector various organised criminal networks dealing in illicit trade. 3. Focus areas: a. Rosewood — Rosewood is the primary resource being b. Gold illegally logged and smuggled out of the c. Wildlife country, mainly to China. Actors in the d. Crime convergence trade have strong patronage networks 4. Other sectors affected by corruption with the political elite, and some 5. Legal and institutional framework rosewood timber barons are politicians. 6. Other stakeholders 7. References — While there are several cases of gold smuggling that have come to light, there is a need for further research for an in- Caveat depth understanding of the various actors and networks involved. It ought to be noted that a screening of the public domain and conversations with anti-corruption — Wildlife trafficking is rampant with activists reveals that there is a gap in the in-depth several species, including tortoises and understanding of the actors, networks and lemurs being smuggled out of the corruption risks in the illegal gold mining and country via land and sea. smuggling sector. — Harassment of those raising voices against corruption and environmental Background crime is on the rise.

Political instability, government corruption and a lack of accountability have persisted since the previous overview of Madagascar (Transparency International 2018).

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The COVID-19 pandemic has sparked a strong traffickers to clear stocks of precious wood that recession in Madagascar, impeding years of progress they had hitherto hidden (Ngounou 2020). towards poverty reduction and increasing poverty disproportionately among urban populations (World The country scores 25/100 and ranks 149/180 in Bank 2020). The combined impact of global trade Transparency International’s Corruption disruptions and domestic containment measures is Perceptions Index (CPI) 2020. Freedom House estimated to have resulted in a GDP contraction of (2020) on the other hand lists Madagascar as 4.2 per cent in 2020, similar to that observed during “partly free” with a score of 61/100. According to the devastating 2009 political crisis (World Bank the Worldwide Governance Indicators, the control 2020). Vulnerable populations, particularly those of corruption percentile ranks for the island were living in urban areas, were the most affected by job 14.9 and 15.9 for 2018 and 2019 respectively losses in key manufacturing service sectors and the (World Bank 2019). loss of income caused by the sudden contraction in Rosewood and precious stone trafficking, smuggling activity. One report also notes that rural households of rare and protected species, corruption among were affected, but resilient agricultural productivity customs and tax officials, the rigging of public helped reduce the impact (Stocker et al. 2020). procurement markets, drug smuggling, and Straddling the nexus of COVID-19 and corruption kidnapping are some of the symptoms of generalised in the country was the case wherein the Minister of corruption. Due to weak institutions, activities such the Interior used development aid for COVID-19 as money laundering through real estate purchases recovery to purchase supplies from the company and trafficking in, for example, precious stones are where his wife is a director (Transparency proliferating and cannot easily be punished through International 2020b). the legal system. At the same time, a lack of information (an inadequate property registry, for While natural resources have been primary targets example), imperfect tax and bank records, and of corruption and trafficking on the island, limited international cooperation are obstructing the environmental crimes have only intensified in use of domestic and foreign information to tackle Madagascar since the adoption of containment financial crime (Baum et al. 2017). measures to limit the spread of COVID-19 (Rahman 2019; Ngounou 2020). For example, social and economic impacts of containment measures to limit the community-level spread of the pandemic have led rural populations1 to turn to protected areas as a means of subsistence. Moreover, as noted by the Minister of the Environment and Sustainable Development, the situation has also provided temptation for

1 The rural population is estimated to be 80.5 per cent of the total population in the country (Orange Madagascar 2019).

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Forms of corruption in the continues to thrive, plaguing the everyday lives of the population (Baum et al. 2017). natural resources sector Political corruption and patronage

Trafficking of natural resources, public Political corruption is both common and rarely officials and bribery prosecuted (Bertelsmann Stiftung 2020). Madagascar’s anti-corruption agency According to a statement made by USAID mission (BIANCO) alleges that several legislators adopted director in the country, “Wildlife and timber an electoral reform package benefiting former trafficking are multi-billion dollar transnational president Hery Rajaonarimampianina in return for criminal enterprises that rob Madagascar of its bribes in 2018 (Freedom House 2020). BIANCO unique biodiversity and the Malagasy people of a gave federal prosecutors the names of 79 members sustainable future” (US Embassy in Madagascar of the National Assembly (over half of the total 2021). Madagascar’s weak central government and number of members) who are accused of being long and inadequately monitored coastline makes it involved in the corruption scandal2 (Trilling 2019). vulnerable to all sorts of trafficking (Rahman 2019). Even at the highest level, presidents have There continues to be widespread impunity for consistently maintained significant informal officeholders who break the law, especially with networks of power (with the economic, religious regard to the trafficking of natural resources. This and military elite). Such a move is often seen as a is particularly the case for some members of necessary condition for maintaining formal power political institutions – such as members of as these groups have the potential to undermine parliament – who, despite their involvement in democratically elected representatives trafficking, are not prosecuted. (Bertelsmann (Bertelsmann Stiftung 2020). Stiftung 2020). A part of the private sector has close ties with those Trafficking is made possible through high levels of that hold political power, which facilitates consensus corruption (grand as well as petty corruption) in but sometimes distorts the situation (Bertelsmann the country (Rahman 2019). People perceive petty Stiftung 2020). How patronage works is that corruption to be a frequent feature in interactions economic networks struggle for power via strategic with the public services, administration, the police, support of political candidates. In turn, a narrow the gendarmerie and the judicial system. A large group of political elites maintain their status by majority of the population believes that some civil supporting the interests of their private sector servants are corrupt. This form of corruption has patrons. As a result, lines between public and private always been present in the Malagasy context and expenditures are blurry and democratic accountability is reduced (Freedom House 2020).

2 The accused legislators took 50 million ariary (USD$14,000) to vote for the amendments during a secret meeting outside the country’s capital (OCCRP 2019).

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Political corruption in the natural resources sector themselves with illegal logging and trafficking in is prevalent. For example, many timber barons who the country’s north-eastern protected areas. Such run the trafficking trade are allegedly politicians or activities have made multimillionaires of an elite have close ties to government figures (Ong and few and profoundly reconfigured the country’s Carver 2019). Malagasy political elites were able to geographies of power as such groups have control well-developed networks and capture supposedly leveraged their earnings to step into the resource rents (Frynas et al. 2017). national political arena and control the market to make even more illicit profit. These rosewood While corruption was thought to be pervasive at all traders being voted into central offices in levels of government, the current administration, Madagascar’s government could demonstrate how however, has focused greater attention on democratic institutions that are supposed to foster countering corruption, leading to multiple equality have been captured to sustain long- convictions (US Department of State 2019). For standing patterns of inequality (Anonymous 2017). example, Claudine Razaimamonjy3, an unofficial advisor to the previous president, was imprisoned for seven years with hard labour and was required Focus areas to pay a fine of 100 million ariary (US$27,000) for public fund embezzlement (US Department of State Rosewood 2019). Nevertheless, anti-corruption experts are wary of the gap between words and actions when it According to the United Nations Office on Drugs comes to the governmental agenda of countering and Crime (UNODC), rosewood is the most corruption. The speculation is that political trafficked form of flora and fauna in the world, motivations are guiding the anti-corruption measured by value or volume (Guo 2019). It is campaign as the targets seem to be political traded far more than elephant ivory, rhino horn and opponents of the current regime (TI-MG 2020). pangolin scales put together, and is often called the “ivory of the forest” (Ong and Carver 2019). However, conscious exclusion of civil society in governance agenda setting and policy formulation Illicit rosewood logging triggers problems that go and evaluation is cited as one potential cause of the beyond the removal of rare tree species. In the continued lack of accountability and corruption at Malagasy context, which has “more genetic the political level (Bertelsmann Stiftung 2020). information per surface unit” than any other country in the world, tall rosewood trees serve as State capture key nesting areas for endemic animals such as ruffed lemurs and, according to a 2018 study in the An article from Political Geography (2017), American Journal of Primatology, logging has published by an anonymous author for their “devastating consequences” on the indigenous protection, posits the emergence of a rosewood species (Vasey et al. 2018). elite that has, since the 2009 coup, enriched

3 It ought to be noted that Claudine Razaimamonjy was arrested former regime, and her conviction is therefore the result of years of when previous President Rajaonarimampianina was still in power. administrative/legal work. Razaimamonjy was arrested and investigated by BIANCO under the

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Despite logging rosewood being banned in Madagascar, it remains a big business. The last set of reliable figures from 2013 estimate that between US$250 and US$300 million in exotic timber, mostly rosewood, was illegally exported from the island that year (Sharife and Maintikely 2018). The main target area for illegal rosewood logging and trafficking is the north-eastern Sava region where a number of the rosewood barons mentioned earlier control the trade (Anonymous 2017; Sharife and Maintikely 2018; Ong and Carver 2019).

Organised Crime and Corruption Reporting Project Figure 1: Map of financial flows and key players in the (OCCRP) conducted an undercover investigation to rosewood trade. Arrows approximate relative size and understand the corrupt practices involved in the direction of financial flow. Dotted lines represent illicit rosewood logging business (Sharife and transactions of questionable legal status. Circles represent Maintikely 2018). Through information gained sources and squares represent sinks (Anonymous 2017). from secret government documents, speaking to locals and so-called rosewood barons, reporters To get rosewood off the island, it is brought to unearthed that the illicit trade is protected by coastal villages and transported via small boats to powerful insiders with close ties to government supply larger vessels in the open seas – with ships officials and political players (Sharife and not having to enter official ports, the entire Maintikely 2018). procedure on declaring freight items is averted There are several actors involved in the chain – (Anonymous 2017). Illegal rosewood is often from loggers, transporters, middlemen and agents disguised as and mixed with legal vanilla, with acting as suppliers and negotiators to professional most rosewood traffickers also trading vanilla as a enablers such as lawyers, brokers, investors and commodity (Sharife and Maintikely 2018). Thus, accountants, legitimate traders and exporters, segregating rents generated from trafficked corrupt public officials including police, army, rosewood from profits generated from legitimate customs officers and regional leaders, as well as the vanilla export proceeds of those involved acts as a rosewood barons (Anonymous 2017; Sharife and significant challenge for investigating agencies Maintikely 2018; Ong and Carver 2019). Rosewood (Sharife and Maintikely 2018). barons often own their own shipping companies, with some even having links to top politicians While the final destination for trafficking is usually (some allegedly have connections up to the office of China, it is rarely mentioned as such on official the president) (Sharife and Maintikely 2018). records with the cargo being shipped through other destinations. The destinations of choice for most vessels carrying illicit rosewood are officially Mauritius, which being a tax haven does not

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require disclosure on the re-distribution of (Ong and Carver 2019). Later in 2017, CITES listed imported items, or Mombasa in Kenya (Sharife and all the world’s Dalbergia4 species, as well as other Maintikely 2018). rosewoods, under Appendix II, banning their trade (Ong and Carver 2019). However, since such ports are well patrolled, “friendly local networks” are leveraged to protect the illicit cargo from detection. Other transit points include small islands or “dark ports” in the Indian ocean such as Réunion, Mayotte and Comoros, where the trafficked rosewood can more easily be moved to other vessels and its country-of-origin disguised (Sharife and Maintikely 2018).

After changing ships, the rosewood is transported to various destinations in East Asia before reaching China. Some of these countries, such as Hong Kong and Singapore, are secretive tax havens. Others, Figure 2: Map of the flow of logs from Masoala National like Myanmar, Laos and Vietnam, are renowned for Park. Rosewood logs travel from the park’s interior to the their lax policing of maritime trade (Sharife and villages and coastal boats for overseas shipment Maintikely 2018; Ong and Carver 2019). (Anonymous 2017).

The rosewood trade has been banned in In 2018, to pay for conservation efforts, the Madagascar for decades, but the government has government came up with a business plan which it issued brief exemptions, most notably during two laid before CITES to export rosewood that fell periods in 2009. This muddied the legal waters for naturally as “acts of God” during a storm of 2013 years after the fact, allowing traffickers to claim (Sharife and Maintikely 2018). However, CITES their rosewood was harvested during an exemption partners such as the US asked how the government period and therefore legal. In 2013, the Convention intended to distinguish between logged rosewood on International Trade in Endangered Species of from those that fell naturally5 (Sharife and Wild Fauna and Flora (CITES) listed all types of Maintikely 2018). CITES ultimately rejected the Madagascar rosewood as Appendix II, prohibiting plan (Carver 2018). their trade except in the rare cases in which a local CITES authority has issued sustainability permits Apart from the supply side of rosewood corruption, the demand side in China also ought to be

4 Rosewood refers to the darkest and most uniformly coloured This was the wood they had hoped to convince CITES to allow them hardwoods in the genera Dalbergia and Pterocarpus, among others. to sell. However, according to a confidential government document, Dalbergia from Madagascar and Asia-Pacific are generally darker just 10 of the 101 recognised stockpile owners allowed inspectors and more valuable than the Pterocarpus of West Africa (Ong and onto their premises. Owners are known to guard their valuable logs, Carver 2019). paying private security guards — or sometimes state police — some 5 OCCRP undercover reporters learned that, a few weeks before the US$80 to US$100 a month to watch over the wood. The reporters meeting, the government’s inter-ministerial coordination body note that the majority of these stockpiled logs remain outside the spent US$250,000 to do an audit of some 300,000 stockpiled logs. control of the government (Sharife and Maintikely 2018).

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understood. A timber dealer based in Zhangjiagang, likewise, if it had the political will to do so” a hub in the rosewood business with shipments from (Transparency International 2018). Africa coming up the Yangtze, says that the trade environment is “dirty” with business without The global network of illicit rosewood trade has a corruption being next to impossible (Ong and Carver large human cost as well. A report examining the 2019). The dealer admits that while traders know illicit logging industry in Madagascar, for example, that most of the logs are illegally felled, when logs estimated that three out of every 10 loggers in the enter China with the “right” documents, they industry die in workplace related accidents. A local 6 become legal (Ong and Carver 2019). Moreover, Malagasy politician confirmed to ENACT Chinese officials charged with inspecting large-scale researchers that high mortality rates at logging rosewood warehouses are taken care of by “slipping sites have become a major issue. The illicit logging money into the pockets” or “arranging women for sector is rife with child labour, and sexual 7 them” (Ong and Carver 2019). exploitation . While the environmental and economic impacts of the illicit timber trade have The current Malagasy president, Andry Rajoelina, been widely discussed, what also needs to be taken led the country from 2009 until 2013 — the most into consideration is human impact in terms of the intensive period of rosewood logging in the degradation of human rights, quality of living and country’s history. He is thought to be close to the prospects for communities living and working in timber barons, and environmental conservationists and around illegal logging sites (Reitano and fear that another major rush to the rainforests Randrianarisoa 2018). could commence (Ong and Carver 2019). Under Rajoelina’s earlier rule, rosewood trading was so Gold pervasive that “a large, unexplained stash of rosewoods logs … at the presidential palace” was Gold mining in Madagascar exists essentially in the found (Sharife and Maintikely 2018; European form of gold panning which is the extraction of gold Parliament 2017). deposits by artisanal processes. The main sites are in Betsiaka, Dabolava, Antanimbary-Maevatanana, Activists countering timber trafficking have faced Ambatolampy and Mananjary (Rahman 2019). repeated harassment from traffickers and Exploitation of gold in the Malagasy context is government officials alike (Sharife and Maintikely mostly illegal. Illegal, and thus by extension, 2018; Ong and Carver 2019). Environmental unregulated, gold mining is not only embroiled in activists say they face bribes and threats from corrupt practices but it has massive environmental traffickers on one side, and jail time and fines from impacts as well (Rahman 2019). For example, the government on the other (Carver 2017). TI-MG forest loss due to mining is a recent and growing and Voahary Gasy Alliance (AVG) state that if trend, and one wetland forest in Madagascar’s “journalists have been able to infiltrate an existing main national park is on the verge of being wiped mafia network and identify specific details of its out (Gerety 2019). modus operandi, the government could have done

6 Enhancing Africa’s response to transnational organised crime – a 7 Under-age girls from as far away as Nigeria are often forcibly European Union funded project trafficked to logging sites in these regions for sexual exploitation.

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In Madagascar, gold extraction is carried out by While informal gold production remains a gold panners and gold permittees; marketing is challenge to trace, in 2018, ANOR recorded 3,051.7 carried out by collectors and jewellers; melting is kg of gold being officially exported, for a total value attributed to the approved jewellers. The National of US$97,655,001.28 (EITI Madagascar 2019; Gold Industry Agency (ANOR) has tried to regulate IHARIANTSOA 2021). The main destinations for this sector via the issuance of licences; however, Malagasy gold are Dubai, Hong Kong and small-scale and artisanal gold mining appears to be Singapore (Rahman 2019; IHARIANTSOA 2021). controlled by a network of powerful traders who are allegedly involved in smuggling, resulting in a A governance and development effectiveness significant loss of income to the state (Rahman review conducted by the World Bank in 2010 lists 2019; IHARIANTSOA 2021). the “gold value chain”:

Table 1

Agent Activity description

Local individuals or small family groups pan for alluvial gold dust in current or former riverbeds. Often part-time in complement to agricultural activity. Gold panners often sell Panners their findings daily to local grocery store owners in return for goods or money. If they do not depend on daily sales, they can save their gold and skip one intermediary by selling directly on the weekly market.

Epiciere A local epiciere weighs the gold, stores it and sells it every week to collectors on the (small grocery market. store owners)

(Often local) collectors buy gold from “épicerie” or directly from panners. They typically do Collector not use their own money but are financed by super-collectors who come before the market day to provide collectors with cash.

Super-collector Most super-collectors are not local but come from the capital or a larger town. They (limited visibility) typically run (finance) several collectors in different villages.

Gold trader/ gold Gold traders buy gold from super-collectors, either to use it for wealth storage in some user quantity or export it. Gold users are domestic jewellers who buy gold (in part) for their own (limited visibility) production.

Source: World Bank (2010).

the seizure of 73.5kg of gold illegally exported from Over the past five years, an increase in the illicit Madagascar to Johannesburg on 31 December export of gold has been observed in Madagascar 2020 (Linfo 2021; Freedom 2020). (IHARIANTSOA 2021). Among the most recent cases are the seizure of 25 kg of gold from Admittedly, since 2019, the Malagasy government Madagascar in Mauritius in October 2020, the has repeatedly declared their intent to clean up the attempted smuggling of 15 kg of gold to Dubai gold industry through the application of sanctions intercepted at Ivato airport in November 2020 and against traffickers; nevertheless, such examples

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show that considerable quantities of gold continue 2010). The importance of Indian families in the to leave the country. Moreover, it must be noted gold sector is the result of social networks that have that gold trafficking cases are often dismissed grown around gold export (to India) for over a without trial (IHARIANTSOA 2021). century – largely untouched by the central state (World Bank 2010). To evade domestic revenue With respect to the recent case involving the taxes and to transform gold into hard currency in smuggling of 73.5 kgs of gold, the Rajoelina Madagascar, practically the entire gold production government has come on the radar because the is informally smuggled out of the country and sold plane that flew the smugglers to Johannesburg is abroad by these gold traders (World Bank 2010). frequently used by the finance ministry (Africa Given its high value:volume ratio, enforcing export Intelligence 2021). controls is difficult and costly for the state (World Bank 2010). Given the long-standing presence of gold mining in Madagascar, well-established trading networks Results extracted from the TI-MG’s report on the have emerged controlled by an elite group of analysis of corruption in the artisanal mining in traders (World Bank 2017). These elites, mainly Madagascar of gold and sapphire and published in from Indo-Pakistani heritage, have developed 2017 lists certain risks of corruption in the gold inroads within the Malagasy government and have sector in the country (RANDRIAARSON 2017; attained significant state capture (World Bank IHARIANTSOA 2021):

Table 2

Activities Actors involved Form of corruption Risk ranking Administrative phase: Inter-regional BCMM (Bureau du Cadastre Influence peddling in high Moderately permit application Minier de Madagascar) places, favouritism frequent

Installation phase CTDs (Collectivités territoriales Active and passive Less frequent décentralisées), landowner, traditional corruption authorities

Operation phase Collectors, CTDs, mine inspectors, mine Bribery, abuse of office Very frequent police, law enforcement

Transformation phase Mining inspector, law enforcement, Extortion, bribery, abuse Moderately jeweller, lapidary, trader of office, illegal franchise frequent

Transport phase Large collectors, PAF (airport authorities) Bribery, abuse of office, Moderately airport security, tarmac gendarme, law illegal franchising, frequent enforcement

Export phase Company, operators, PAF, tarmac police, Abuse of office, clientelism, Moderately customs, security, flight personnel, favouritism, active and frequent technical personnel, catering personnel, passive corruption etc.

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For a detailed overview of artisanal mining in Systemic corruption is the key which enables such a Madagascar please refer to the paper here. It also thriving wildlife trafficking trade. For example, ought to be noted that a screening of the public while it is forbidden to fish for sea cucumbers with domain and conversations with anti-corruption diving equipment, the laws are not applied to activists reveals that there is a gap in the in-depth everyone, and those at the top of the illegal trade understanding of the actors, networks and often go unprosecuted due to their influence and corruption risks in the illegal gold mining and clientelist networks (Scarffe 2020). smuggling sector. Lemurs are the most threatened group of mammals Wildlife on Earth, with 94 per cent of lemur species at risk of extinction. Circumstances leading to the decline Madagascar ranks 21/54 in Africa for criminality of lemurs include widespread poverty, which leaves according to the Africa Organised Crime Index. The millions of people dependent on forest resources country is also reported to have severe problems in for survival, political instability, corruption and a environmental crime markets (ENACT 2019). lack of effective environmental law enforcement (LaFleur et al. 2019). Madagascar is one of the 17 countries identified by the United Nations Environment Program (UNEP) Over 18,000 radiated tortoises,8 a rare and highly as megadiverse. Such a vast biodiversity in species endangered species found only in Madagascar, were coupled with high levels of criminality have given confiscated in 2018. These tortoises were meant for rise to a widespread wildlife trafficking circuit the illegal pet trade in Asia and showcased the large- (Nelson and Cochrane 2020). The most trafficked scale organised wildlife trafficking business (Reitano wildlife in Madagascar are as follows (USAID 2021; and Randrianarisoa 2018). Rahman 2019): A 2020 report by the Global Initiative Against • reptiles (e.g., tortoises, turtles, chameleons, Transnational Organised Crime on Trafficking geckos, and snakes): illegally collected for Malagasy Tortoises shed light on the extensive the exotic pet and medicine trade. These network of criminal and corrupt actors who actively seem to be the most trafficked. and consistently undermine the rule of law and • lemurs (all varieties): poached for bush governance to be able to run the illegal exotic meat and captured for the illegal pet trade. animal trade (Nelson and Cochrane 2020). The • marine life (e.g., seahorses, exotic fish): country’s vulnerability to endemic corruption, illicit illegally harvested for food as well as the financial flows, a pattern of demand (often pushed exotic pet and medicine trade. by popularisation on social media) and porous • birds (e.g., parrots and other exotic birds): borders seem to drive the tortoise trafficking illegally collected for the exotic pet trade. networks (Nelson and Cochrane 2020).

8 There are two species of tortoises that are illegally trafficked: be left in the wild, each one is worth as much as US$50,000 on the radiated and ploughshare. The ploughshare tortoise is one of the global exotic pet market. rarest tortoises on the planet,; with fewer than 50 adults thought to

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Madagascar’s remaining forests and wildlife are to Antananarivo; tortoises and heroin are both typically found in remote areas, which in many trafficked through airports; and tortoises, cannabis cases are now protected. However, these places are and illegal migrants are smuggled by boat to inherently difficult to police due to limited Comoros (Nelson and Cochrane 2020). While these resources and geography, and they are never far products all use the same routes – and likely the from the coast – which makes trafficking of high- same facilitators who arrange transport and pay value wildlife products from these remote sites to bribes to corrupt officials – there is no evidence coastal cities easier (Nelson and Cochrane 2020). that the same criminal networks are involved in moving both tortoises and other illicit products The majority of Madagascar’s population is rural- (Nelson and Cochrane 2020). based, and, in the areas where they are present, tortoises are an important source of protein. Local people are therefore easily conscripted to poach live tortoises for a cash income, and local officials will often turn a blind eye. Exploiting this situation, tortoise traffickers use intermediaries to approach local communities to arrange for an order of tortoises; the intermediary then makes payment on collection and arranges transport of the tortoises before illegal export (Nelson and Cochrane 2020).

Another category of traffickers includes foreign nationals that are either based in or travel often to Madagascar. In one tortoise trafficking investigation, police officers reported that they had been immediately offered a US$6,800 bribe by the Malagasy nationals they had arrested, and there was subsequent pressure by a general to release the traffickers (Nelson and Cochrane 2020).

Crime convergence

Madagascar is known for rosewood trafficking, Figure 3: Major trafficking routes of ploughshare and wildlife trafficking, trafficking of gemstones and radiated tortoises, within Madagascar and across the gold, human trafficking for sex tourism, cannabis region (Nelson and Cochrane 2020). production and export, and low-level trafficking in Seizure data suggests that a majority of smuggling other drugs and weapons. Research has identified routes out of Madagascar often go via a transit various illicit flows that overlap with the same country in Africa before reaching a destination routes used by tortoise traffickers: cannabis and country in Asia, most commonly Southeast Asia. radiated tortoises travel by the same roads and Most confiscations occur in Southern and East through the same checkpoints from the south-west African transit states such as Mozambique, Kenya,

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Ethiopia and Tanzania, or other island environment, education and health (ITA US nations/territories such as Réunion and Comoros. Department of Commerce 2020). Destination country seizures often take place in Indonesia, Malaysia and Thailand and to a lesser There is anecdotal evidence of collusion between extent the Philippines (Nelson and Cochrane 2020). politicians, businesspeople and some customs agents permitting the clearance of imported While some argue that addressing wildlife shipments by larger, well-connected businesses with trafficking challenges is not a conservation issue, less arduous customs controls (Baum et al. 2017). these are extensive problems requiring broader responses focused on improving governance, rule One interesting point is that if customs officers are of law and crime prevention, and building exercising their duties, they may only be resilience to organised crime (Nelson and Cochrane investigated or arrested with the authorisation of 2020). Successful projects dealing with the the minister in charge of customs, after the opinion challenge can quickly fall apart. For example, of a technical committee placed under the aegis of despite efforts of a coalition of environmental the director general of customs, except in cases of advocacy groups known as AVG, based in in flagrante delicto involving their own Madagascar’s capital city, Antananarivo, responsibilities (IHARIANTSOA 2021). conducting sting operations to collect irrefutable One recommendation relevant to most public evidence against traffickers, traffickers are often offices would be to strengthen entrance exams. granted bail even after conviction (Gerety 2018). This would apply for example to the ENMG (Ecole The most pressing needs, many conservationists Nationale de la Magistrature), the military suggest, are a deeper understanding of actors and academy, national police, gendarmerie, IGE, networks wildlife trafficking, political will to customs officials, ENAF (Ecole Nationale de enforce conservation laws and control of corruption l’Administration Financière) and INFA (Institut (Gerety 2018). National de Formation Administrative), which are currently overseen by the anti-corruption agency, Other sectors affected by BIANCO. The perception exists that many of the corruption (related to natural candidates passed their exams by corrupting officials (Baum et al. 2017). resources) Security forces

Customs Reports have indicated that security forces are often engaged in corrupt trafficking networks. For While giving or accepting a bribe is a criminal act example, rosewood barons keep many local security and is subject to trial by court in Madagascar, there forces on their payroll to protect the illegally logged is a lack of enforcement of existing legislation, timber (Sharife and Maintikely 2018). Officials from which opens the door to widespread corruption. the gendarmerie and law enforcement are known to High levels of corruption exist in all sectors but are be involved in the operations, transportation and most pervasive in the following areas: judiciary, export phases of illegal gold mining and smuggling police, tax, customs, land, trade, mining, industry, (IHARIANTSOA 2021).

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Militia groups in the country are known to use With respect to the environment, PEM highlights members from official security forces to fight the two commitment areas (Ministere de l’Economie et criminal circuits that they have been deployed to des Finances 2019): dismantle (PELLERIN 2017). • energy and water for all The police and military are unable to assert • sustainable management and conservation authority over the entire country, and areas in of Madagascar’s natural resources southern Madagascar are subjected to raids and violence by bandits and criminal groups. Security Supported by the World Bank, the Malagasy forces operate with little oversight or accountability government recently retained a consultant to for extrajudicial killings, particularly against cattle develop a “stockpile verification mechanism and thieves, known as dahalo (Freedom House 2020). business plan” which was discussed at a multi- stakeholder meeting in 2018 and subsequently revised for presentation to the 70th meeting of the Legal and institutional Standing Committee for CITES in October 2018. framework During this meeting, participants acknowledged some improvements in the latest draft of this plan, The Malagasy legal framework has various policies but the inclusion of a provision to provide US$7 on corruption control and prevention. However, million in compensation to traffickers in possession the government does not implement these policies of felled rosewood stocks was strongly opposed by effectively, and corruption remains a serious issue, many CITES parties as well as by environmental as does the lack of government transparency NGOs. Critics felt that such a provision would be (Bertelsmann Stiftung 2020). For a detailed dangerous in the Malagasy context because it would overview of the legal and institutional framework reward those breaking the law and would risk relating to corruption and the natural resources triggering more illegal rosewood cutting. They also sector please refer to the document here. argued that such payments would set a dangerous precedent for CITES (Waeber 2019). The plan was The earlier Plan National de Développement or ultimately rejected by CITES (Carver 2018). National Development Plan to counter corruption has been replaced by the Plan Emergence Law n°2005-021 of 27 July 2005 of the mining Madagascar (PEM) driven by Rajoelina’s code organises the mining sector in Madagascar. campaign document, IEM (Initiative Emergence Decree n°2006-910 of 19 December 2006 sets out Madagascar). the terms of application of the mining code. The current mining code has been under revision since The 2019 to 2023 strategy has three main the beginning of 2020. The ministry in charge of commitment areas related to good governance mining is following a participatory approach in the (Ministere de l’Economie et des Finances 2019): revision process through the establishment of a multi-stakeholder committee representing the • establish peace and security administration, mining operators (large and small • counter corruption with zero tolerance mines), civil society and trade unions. The draft law • autonomy and accountability of local on the mining code is supposed to be submitted to decentralised authorities

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the national assembly for the May or June 2021 session (IHARIANTSOA 2021).

Other stakeholders

Media and civil society

Media access to certain official events has been limited to pro-government media and journalists. In 2019, a court finally acquitted Fernand Cello, a radio journalist based in the south of the country who was arrested in 2017 in connection with his investigative coverage of local corruption and abuse of authority (RSF 2020). The code of communication, a media law adopted in 2016, makes it possible to try media offences under the criminal code, potentially criminalising journalism. It provides for heavy fines for offences ranging from insult and defamation to the publication of “false news” – a vague charge that denies journalists the right to make a mistake. Covering influence-trafficking in connection with natural resources and the environment remains dangerous (RSF 2020).

Civic space has been shrinking in Madagascar. Activists and journalists reporting on corruption and trafficking rings are frequently targeted (Carver 2017; Gerety 2018; Gerety 2019). While there were no official reports of the government monitoring online activity, a cybercrime law prohibits online defamation and has been used to prosecute social media users (Freedom House 2020). Since 2020, the cybercrime law also applies to journalists (Assemblee Nationale 2020).

For a detailed overview of media and civil society please refer to the document here.

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References Gerety, R. 2019. Illegal Gold Mining Destroys Wetland Forest in Madagascar park. Mongabay. Africa Intelligence. 2021. Gold Smugglers Used Same Plane As Finance Ministry. Guo, E. 2019. The Fight to Protect the World’s Most Trafficked Wild Commodity. National Anonymous. 2017. Rosewood Democracy in the Geographic. Political Forests of Madagascar. Political Geography IHARIANTSOA, C. 2021. Note on the gold sector in Madagascar. Transparency International – Assemblee Nationale. 2020. Loi n°2020-006 Initiative Madagascar (TI-MG). portant modification de certaines dispositions de la Loi n° 2016-029 du 24 août 2016 portant Code de LaFleur, M., Clarke, T., Reuter, K., Schaefer, M. la Communication Médiatisée. 2019. Trade of Wild-Captured Lemur catta within Madagascar. Folia Primatologica. Baum, A., Engstrom, L., Esquivel Soto, Y., Eugster,J., Imam, P. and Oestreicher, G. (2017). Linfo. 2021. Trafic 73,5 kg d’or : la justice sud- Republic of Madagascar: Selected Issues. africaine rejette la requête des trois passeurs International Monetary Fund (IMF). malgaches.

Bertelsmann Stiftung. 2020. BTI 2020 Country Ministère de l’Economie et des Finances. 2019. Report — Madagascar. Gütersloh: Bertelsmann Plan Emergence Madagascar. Stiftung, 2020. Nelson, A. and Cochrane, J. 2020. Trafficking Carver, E. 2017. Another Madagascar Malagasy Tortoises: Vulnerabilities and illicit Environmental Activist Imprisoned. Mongabay. markets in the western Indian Ocean. Global Initiative Against Transnational Organised Crime. Carver, E. 2018. CITES Rejects Another Madagascar Plan to Sell Illegal Rosewood Ngounou, B. 2020. Madagascar: COVID-19 Stockpiles. Mongabay. Exacerbates Environmental Crimes. Afrik 21.

European Parliament. 2017. European Parliament Ong, S. and Carver, E. 2019. The Rosewood Trade: Resolution on Madagascar (2017/2963(RSP)). An Illicit Trail from Forest to Furniture. Yale Environment 360. Freedom House. 2020. Freedom in the World 2020: Madagascar. Orange Madagascar. 2019. La population malgache très inégalement répartie sur le territoire national. Frynas, J., Wood, G. and Hinks, T., The Resource Curse Without Natural Resources: Expectations of Projet d’Appui à la Gouvernance (PAGI). No Date. Resource Booms and Their Impact. African Affairs, Étude de la gouvernance et audit des risques de Volume 116, Issue 463, April 2017, Pages 233–260, corruption de fraude et des trafics illicites à l’aéroport international Ivato. Rapport final. Gerety, R. 2018. In Pursuit of the Tortoise Smugglers. The Guardian

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PELLERIN, M. 2017. Madagascar Dealing with Transparency International Madagascar (TI-MG). Multifaceted Crime. 2020. Indice de perception de la corruption (IPC) 2020. Rahman, K. 2019. Overview of Corruption and Anti-Corruption in Madagascar. Trilling, S. 2019. Over Half of Madagascar's MPs Accused of Corruption. OCCRP. Reitano, T. Randrianarisoa, R. 2018. The Human Cost of Africa’s Illegal Logging Industry. ENACT. USAID. 2021. Combating Wildlife Trafficking.

Scarffe, C. 2020. Risking Death and Arrest, US Embassy in Madagascar. 2021. U.S. Madagascar Fishers Chase Dwindling Sea Government Awards $2 Million in Grants to Cucumbers. Mongabay. Combat Wildlife Trafficking and Illegal Logging in Madagascar. Sharife, K. and Maintikely, E. 2018. The Fate of Madagascar’s Endangered Rosewoods. OCCRP. Vasey, N., Mogilewsky, M., Schatz, G. 2018. Infant nest and stash sites of variegated lemurs (Varecia Stocker, M; Razafimanantsoa H; Faniry N; Lalaina, rubra): The extended phenotype. M; Tokle, E; Ravelosoa, R; Aristide, T; Emmanuelle; Rawlings, E; Randrianatoandro T; Waeber, P., Schuurman, D., Ramamonjisoa, B., Mamitiana, P; Quijada Torres, C; Juquois, M; Langrand, M., Barber, C., Innes, J., Lowry, P., Pivodic, F; El Ghandour, I; Rajenarison, H; Wilmé, L. 2019. Uplisting of Malagasy precious Peixoto, C; Rakotomalala, O; Andriamihaja, A; woods critical for their survival. Biological Gueye, M; Amboarasoa, M; Jarotschkin, A. 2020. Conservation. Volume 235. Madagascar Economic Update: Setting a Course for Recovery (English). Madagascar Economic Update World Bank. 2010. Madagascar Governance and Washington, D.C. World Bank Group. Development Effectiveness Review a Political Economy Analysis of Governance in Madagascar. Transparency International. 2018. Madagascar Government Must Take Action on Trafficking of World Bank. 2017. World Bank Launches Precious Wood. Madagascar’s Economic Update.

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Africa Grapples with Corruption and COVID-19, Journalists and Civil Society Suffer Retaliation for Exposing Corruption.

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Annex 1: Table providing a corruption snapshot of the three natural resources.

Commodity Forms of corruption Actors involved Mechanisms used

Rosewood State capture, political Regional timber barons; Sea route corruption, bribery, collusion

Gold Bribery, patronage, Organised crime networks, law Sea and air route clientelism enforcement, customs, politicians

Wildlife Bribery, political corruption, Organised crime networks, law Sea and air route patronage enforcement, customs, politicians

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DISCLAIMER All views in this text are the author(s)’ and may differ from the U4 partner agencies’ policies.

PARTNER AGENCIES DFAT (Australia), GIZ/BMZ (Germany), Global Affairs Canada, Ministry for Foreign Affairs of Finland, Danida (Denmark), Sida (Sweden), SDC (Switzerland), Norad (Norway), UK Aid/DFID.

ABOUT U4 The U4 anti-corruption helpdesk is a free research service exclusively for staff from U4 partner agencies. This service is a collaboration between U4 and Transparency International (TI) in Berlin, Germany. Researchers at TI run the helpdesk.

The U4 Anti-Corruption Resource Centre shares research and evidence to help international development actors get sustainable results. The centre is part of Chr. Michelsen Institute (CMI) in Bergen, Norway – a research institute on global development and human rights.

www.U4.no [email protected]

KEYWORDS Madagascar – Rosewood – Gold – Wildlife – Natural Resources

OPEN ACCESS We apply a Creative Commons licence to our publications: CC BY-NC-ND 4.0.

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